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Why Cadence Design Systems (CDNS) Outpaced the Stock Market Today
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The most recent trading session ended with Cadence Design Systems (CDNS - Free Report) standing at $311.28, reflecting a +1.81% shift from the previouse trading day's closing. The stock's performance was ahead of the S&P 500's daily gain of 1.12%. At the same time, the Dow added 0.61%, and the tech-heavy Nasdaq gained 1.54%.
Coming into today, shares of the maker of hardware and software products for validating chip designs had lost 0.27% in the past month. In that same time, the Computer and Technology sector lost 0.4%, while the S&P 500 gained 2.06%.
Market participants will be closely following the financial results of Cadence Design Systems in its upcoming release. The company's upcoming EPS is projected at $1.13, signifying a 12.4% drop compared to the same quarter of the previous year. At the same time, our most recent consensus estimate is projecting a revenue of $1.02 billion, reflecting a 0.53% fall from the equivalent quarter last year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $5.93 per share and a revenue of $4.59 billion, indicating changes of +15.15% and +12.24%, respectively, from the former year.
Investors should also note any recent changes to analyst estimates for Cadence Design Systems. These recent revisions tend to reflect the evolving nature of short-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 4.27% increase. Cadence Design Systems presently features a Zacks Rank of #1 (Strong Buy).
In the context of valuation, Cadence Design Systems is at present trading with a Forward P/E ratio of 51.52. This expresses a premium compared to the average Forward P/E of 31.47 of its industry.
It's also important to note that CDNS currently trades at a PEG ratio of 3.02. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Computer - Software stocks are, on average, holding a PEG ratio of 2.38 based on yesterday's closing prices.
The Computer - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 47, putting it in the top 19% of all 250+ industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.
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Why Cadence Design Systems (CDNS) Outpaced the Stock Market Today
The most recent trading session ended with Cadence Design Systems (CDNS - Free Report) standing at $311.28, reflecting a +1.81% shift from the previouse trading day's closing. The stock's performance was ahead of the S&P 500's daily gain of 1.12%. At the same time, the Dow added 0.61%, and the tech-heavy Nasdaq gained 1.54%.
Coming into today, shares of the maker of hardware and software products for validating chip designs had lost 0.27% in the past month. In that same time, the Computer and Technology sector lost 0.4%, while the S&P 500 gained 2.06%.
Market participants will be closely following the financial results of Cadence Design Systems in its upcoming release. The company's upcoming EPS is projected at $1.13, signifying a 12.4% drop compared to the same quarter of the previous year. At the same time, our most recent consensus estimate is projecting a revenue of $1.02 billion, reflecting a 0.53% fall from the equivalent quarter last year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $5.93 per share and a revenue of $4.59 billion, indicating changes of +15.15% and +12.24%, respectively, from the former year.
Investors should also note any recent changes to analyst estimates for Cadence Design Systems. These recent revisions tend to reflect the evolving nature of short-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 4.27% increase. Cadence Design Systems presently features a Zacks Rank of #1 (Strong Buy).
In the context of valuation, Cadence Design Systems is at present trading with a Forward P/E ratio of 51.52. This expresses a premium compared to the average Forward P/E of 31.47 of its industry.
It's also important to note that CDNS currently trades at a PEG ratio of 3.02. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Computer - Software stocks are, on average, holding a PEG ratio of 2.38 based on yesterday's closing prices.
The Computer - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 47, putting it in the top 19% of all 250+ industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.